Class Action: Philadelphia Center City Should Refund Overcharged Taxes

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Two Philadelphia taxpayers say the city’s Center City District has been unlawfully failing to refund tax money after property values are lowered on appeal.

Plaintiffs Thomas Knox and Convention Center Parking LP, both property owners in Philadelphia’s Center City, are challenging the property tax assessment methods used by the City of Philadelphia and its Center City District, both of whom are named defendants.

The plaintiffs claim this property tax regime results in disparate treatment of property owners who successfully get the assessment of their property value reduced on appeal. Based on those reductions, the Center City District refunds overpaid taxes to some property owners but not to others, the plaintiffs say.

The Center City District is a public entity charged with managing public space improvements and enhancing economic development in downtown Philadelphia. Its activity is funded by mandatory assessments levied on taxable property within the District, assessments that are paid by the property owners.

According to this Center City District class action lawsuit, the existing taxation method violates the District’s enabling statute and provisions of the Pennsylvania and U.S. constitutions.

Plaintiffs say that by assessing property taxes based on artificially high values, the Center City District exceeds its statutory authority. And by treating property owners differently without a valid reason to do so, the District is violating both the uniformity clause of the state constitution and the Equal Protection clause of the U.S. Constitution, the plaintiffs argue.

Convention Center Parking says it got the city-assessed value of its Broad Street property reduced by over $2 million for tax years 2014 through 2016. Yet the Center City District failed to tax the company at the correct rate for those tax years, the company claims.

Knox says the city’s property tax assessment overvalued his condominium. He successfully appealed that assessment, and the city lowered that valuation by almost $1 million. But even after that appeal, he claims, the Center City District refused to lower its own valuation of his condominium and refused to refund the taxes he overpaid based on the higher assessment.

Knox and Convention Center Parking blame the Center City District’s “notice policy,” which requires property owners to submit a chain of paperwork to the District if they want the District to recalculate their taxes based on the city’s new, lower property assessment.

The proposed plaintiff Class in this Center City District class action lawsuit would cover all property owners who won a reduced assessment of their property value on appeal to the City of Philadelphia and to whom the District did not return excess money based on the higher assessment, and who remain subject to the higher assessments by the Center City District from 2014 through the present.

They are seeking a court declaration that the Center City District’s past use of anything but the reduced assessments in determining property values had been unlawful. They also seek an award of damages, restitution, court costs and attorney’s fees.

Knox and Convention Center Parking are represented by George Bochetto and John O’Connell of Bochetto & Lentz PC.

The Philadelphia Center City District Property Tax Overcharge Class Action Lawsuit is Convention Center Parking LP and Thomas Knox v. City of Philadelphia and Center City District, Case No. 170601374, in the Philadelphia County Court of Common Pleas.